Thursday, December 27, 2007
As we move into 2008, we need your help to continue with our efforts to remove large firms from federal small business contracting.
We are asking that you to make a donation that makes sense for your small business and support the ASBL in 2008. With your help, we hope to continue our progress towards the removal of large firms from federal small business contracting by supporting annual re-certification in S.2300 the Small Business Contracting Revitalization Act of 2007 and by pushing for other effective legislative solutions to the diversion of federal small business contracts to large and international corporations.
Additionally, if you know of another small business owner or concerned person that would be interested in supporting the ASBL, please pass this along. We appreciate all of your time and support.
Have a Happy New Year!
Click here to donate
Wednesday, December 26, 2007
Kerry, Snowe Seek to Halt Elimination of Small Business Contracts at GSA
The ASBL is applauds Senator Kerry and Senator's Snowes request for the GOA study and their letter to the GSA.
Thursday, December 20, 2007
Monday, December 17, 2007
Friday, December 14, 2007
Small Business Contracting is Vital, but Does the SBA Think So?
Thursday, December 13, 2007
Wednesday, December 12, 2007
Critics: SBA hiding truth on small-business contracts
By ELISE CASTELLI
December 11, 2007
Wednesday, December 5, 2007
Office supplies ordered in Miami, awarded to a firm in Belarus and counted as small business contract…
One example of this abuse occurred in April of 2006 when a contracting office located in Miami awarded a $951,876 contract for office supplies to a firm in Belarus , counting it as small business contract. The award was entered as
"MISCELLANEOUS FOREIGN CONTRACTORS" DUNS # 123456787. Searching on FPDS-NG, the records shows this "company" having "$1000" in revenue and "10 employees" when in reality, this is not a company at all and this has created a loophole allowing contracting officers to award contracts to foreign entities in the guise of small business awards.
If you’d like to see this for your self go to fedspending.org or search by
Select; "contracts" – Select; "Advanced Search Contracts Database"
Select; Place of Performance / Place Country -- Belarus
Select; Contract Details / Product or Service Category --75: office supplies
Select; "Get list of transactions" and then click "$951,876"
Situations such as the above keep us here at ASBL motivated in working for small business. The ASBL continues to work on exposing the 6 billion dollar abuse of the "miscellaneous foreign contracts" category and we are working to prevent this from being counted towards the U.S. Small Business goal. However we need your help. If you've lost a legitimate small business contract to a large or international firm, please email us at info (at) asbl.com and share your story with us.
Tuesday, December 4, 2007
Lloyd Chapman: Wouldn’t it improve transparency if the Small Business Administration listed the top 100 recipients of small business contracts online?
Steven Preston: That is a great idea; I had never thought of that, we should take a look at that.
Preston: Are you concerned because the top 100 would show people that may not be small?
Chapman: Yea, I am concerned because the top 100 includes Lockheed, Boeing, and Halliburton. It is predominantly Fortune 1000 corporations.
Preston: Yea, that is interesting, I don’t know about the systems of the past, but yea we will take a look at that.
SBA Administrator Discusses Major Reforms to Government Contracting, Friday, August 17th
Monday, December 3, 2007
FEDMINE.US Top 50 recipients of Small Business Contracts
By JENNIFER HELDT POWELL
Friday, November 30, 2007
However with this SBA release we’re shocked to see that large firms still show up on their scrubbed (their words) report.
Here is one of the most interesting quotes from the SBA's report,
“Four of the Top 100 firms were affected by miscodings. Three of them were incorrectly identified as “other than small,” even though the companies are legitimate small businesses. One company was miscoded as a small business in 2006, even though it was not small.”
Why does the SBA use the term “other than small” to mean “large business”? Why not call a spade a spade?
With just quick sampling we’ve found large businesses listed in the top 100. Let us know your thoughts. Why do these large firms receive small business contracts?
Why is Sierra Nevada Corporation considered small with over 900 employees and 344 millions dollars in sales?
Sierra Nevada Corporation’s Hoover’s profile
World Wide Technology has over one thousand employees and over 2 billion dollars in revenue however they are receiving small business contracts.
World Wide Technology Hoover’s Profile
GTSI has over 850 million dollars in sales and over 900 employees however they are receiving small business contracts.
GTSI Hoover’s Profile
According to GTSI's 1999 10K
"As a result of the acquisition of the BTG Division in February 1998,
GTSI no longer qualifies as a small business for future contract awards."
GTSI IR site
SBA Promotes Federal Contracting Transparency With Release of Top 100 Report
Thursday, November 29, 2007
MotherJones US Chamber Blog
Did you have a chance to watch the CNN/You Tube debate last night? If you did you may have noticed that small business issued where once again ignored. It will be interesting to see who from either party comes forward as the voice of small business.
CNN You Tube Transcript
Wednesday, November 28, 2007
Wednesday, November 14, 2007
I wanted to let you know that the Senate Committee on Small business and Entrepreneurship voted on and passed S.2300 on November 7th. This bill will now move to the full Senate.
S. 2300 addresses:
- Contract bundling
- Annual re-certification via CCR (with out additional bureaucracy see Sec. 502)
- Subcontractor misrepresentation
- Expands opportunities for minority, women and service-disabled veteran owned small business.
Please email your elected officials today and ask them to support S. 2300.
Text: "Please support S. 2300 the Small Business Contracting Revitalization Act and annual re-certification via CCR which will help remove large firms from Federal Small Business Contracting."
Senate Contact list
House Contact list
Link to the S. 2300
Tuesday, November 13, 2007
Wednesday, November 7, 2007
Tuesday, November 6, 2007
Senate Drafts Legislation to Remove Large Firms From Federal Small Business Contracting
Tuesday November 6, 8:00 am ET
PETALUMA, CA--(MARKET WIRE)--Nov 6, 2007 -- The following is a statement by the American Small Business League:
On Monday, the Senate Committee on Small Business and Entrepreneurship announced that a public markup of S. 2300 the, "Small Business Contracting Revitalization Act of 2007," will be held on Wednesday, November 7th, 2007 at 9:30 a.m. The bill -- drafted by Senators John Kerry (D-Mass.) and Olympia Snowe (R-Maine), the Chairman and Ranking Member of the Committee -- includes provisions that the American Small Business League has been lobbying for since 2002.
The bill is designed to improve oversight in federal contracting, reduce contract bundling, prevent misrepresentation in subcontracting, help service-disabled veteran-owned small businesses access to contract and subcontract opportunities, direct the Small Business Administration to implement women-owned small business program, extend the 8(a) contracting program through 2012 and strengthen the government's ability to enforce the size and status standards for small business certification, according to a Monday press release.In May 2007, the ASBL launched a national campaign to encourage chambers of commerce across the country to contact their representatives in Washington -- in particular Senators Kerry and Snowe -- to support stemming the flow of federal small business contracts to large corporations.
In 2002, the ASBL was the first organization to expose the diversion of federal small business contracts to large corporations. Information supplied by Lloyd Chapman, Present and Founder of the ASBL, prompted the first GAO investigation and the first congressional hearing on this subject, which took place on May 7th, 2003. Since that time, there have been more than a dozen federal investigations that have found fraud, abuse, loopholes and a lack of oversight in federal small business contracting.
"I am pleased to see that S. 2300 includes all of the changes that have been recommended by the ASBL since 2002," President of the American Small Business League Lloyd Chapman said. "Every small business in the country needs to realize that they owe Senators Kerry and Snowe a debt of gratitude for drafting this legislation."
The ASBL intends to launch a national campaign to encourage its members and all small business owners to contact their representatives in support this legislation.
Monday, November 5, 2007
The Senate Committee on Small Business and Entrepreneurship will be marking up and voting on S.2300 on Wednesday November 7th.
Wednesday, October 31, 2007
Sunday, October 14, 2007
Rocky Mountain News
House bill rewards large firms at expense of small ones
By Lloyd Chapman October 13, 2007
Politicians in Washington love to talk about how important small businesses are to our nation's economy. They use catch phrases like "small businesses are the heart and soul of America's economy."...
Thursday, October 11, 2007
Friday, October 5, 2007
The Jay Marvin Show September 28, 2007
Wednesday, October 3, 2007
Link to press release:
Monday, October 1, 2007
Here is a link to the official statement:
Thursday, September 27, 2007
Wednesday, September 26, 2007
As you may know H.R. 3567, the Small Business Investment Expansion Act of 2007 represents a loophole that will allow large venture capital firms to obtain a controlling interest in a small business and maintain that firm’s small business status for an indefinite period of time. This will divert billions of dollars in federal small business contracts to large firms every year, and force legitimate small businesses to compete head-to-head with large firms for even the smallest orders for goods and services.
We strongly believe that H.R. 3567 is an injustice to small businesses across America and respectfully requests that you "vote NO" on this bill.
Thank you for your time and consideration to this request.
Tuesday, September 25, 2007
Saturday, September 22, 2007
The bill is titled H.R. 3567, the Small Business Investment Expansion Act of 2007. We are concerned with title V of the act, which will allow large venture capital firms to acquire controlling interest in a small business and maintain that businesses small business status for an indefinite time period. This legislation is essentially going to force legitimate small businesses to compete head-to-head with large corporations for federal small business contracts. Below, we have included links to: the full text of the bill, a congressional directory and a recent story by Keith Girard from Allbusiness.com that covers this issue.
Final amendments are due Wednesday (9/26) and the bill was just introduced Thursday (9/20).
Please reach out to your representative and ask them to: "Amend title V of HR 3567 to maintain the definition of Small Business as independently owned and operated."
The Bill http://thomas.loc.gov/cgi-bin/query/D?c110:1:./temp/~c110Zps4MH::
Congressional directory http://www.house.gov/house/MemberWWW.shtml
Media Story http://allbusiness.cbsnews.com/government/4923343-1.html
Thursday, September 20, 2007
All hearing Clips
Q&A with Congresswoman Yvette Clarke (D-NY) and Jovita Carranza
Wednesday, September 19, 2007
Friday, September 14, 2007
The bill has not been introduced, however it has already garnered opposition from small business advocates like the American Small Business League as well as, Administrator of the Small Business Administration, Steven Preston and ranking minority member of the House Small Business Committee, Representative Steve Chabot (R - OH).
In an interview with Girard, Chabot referred to the act as, "eviscerating." and said that it would, "drastically change the long-held standard [under the act] that a small business is one that is 'independently owned and operated.'"
Administrator Preston also had words for lawmakers on the new legislation, "The basic premise of small business-size status is circumvented by the provision," he said. "We must object."
In addition to Chabot and Preston, Girard also received comment from the President and Founder of the American Small Business League, Lloyd Chapman, Who stated, "I'm violently opposed. It's essentially a partial repeal of the Small Business Act."
For more information please read Keith Girard’s story, “Contentious Debate Looms Over Small Business Venture Capital,” by visiting:
Thursday, September 13, 2007
We have received a few emails recently asking for congressional contact information in additional to those directories here are some other links that you may find helpful.
This site allows you to look up legislation in Congress
US Senator directory
US Representative Offices
Monday, September 10, 2007
Wednesday, September 5, 2007
Feds change rules for small business contracting goal
- August 31, 2007by Ben HammerStaff Reporter
Wednesday, August 29, 2007
“The agency report outlines four strategic goals, which are largely similar to past SBA planning cycles, except it delves into areas that it seeks to improve,” according to an a blog from the Washington Post’s Sharon McLoone.
This a great opportunity America’s 26 million small businesses to speak up and let the SBA know they will no longer tolerate the diversion of federal small business contracts to large corporations. We are asking our members, their employees and other friends of small business to contact the SBA and let them know that the removal of large firms from federal small business contracting needs to be a priority now and in the future.
Monday, August 27, 2007
Tuesday, August 21, 2007
During an SBA hosted teleconference on Friday, August 17th, SBA Administrator Steven Preston told journalists that miscoding was still a problem and that miscoding was the main reason that large firms such as Lockheed Martin were still receiving federal small business contracts. Other firms receiving federal small business contracts include Halliburton, Raytheon, Northrop Grumman, SAIC, and General Dynamics.
The SBA began to cite miscoding as a reason for the diversion of federal small business contracts to Fortune 500 firms beginning in 2002. Yet, in the last five years the SBA has been unable to explain why miscoding, which should be a random occurrence, tends to happen only in situations involving contracts to large companies miscoded as small business contract awards and not as large business contract awards to small companies.
In addition to the miscoding, Administrator Preston claimed that “old regs” were another problem which allows large businesses to receive federal small business contracts and acknowledged that in previous years small business contracting numbers posted by the Bush Administration did contain awards to Fortune 500 companies because of these old regulations. However, Preston failed to mention that the old regulations that have allowed the federal government to report awards to large businesses as small businesses contract awards were written by the federal government and coauthored by the SBA and the Office of Management and Budget.
Since 2002, there have been more than a dozen federal investigations that offered more plausible explanations as to why the world’s largest defense contractors have received federal small business contracts. A report from the SBA Office of Advocacy found fraud in the form of vendor deception, the SBA Office of Inspector General found fraud in Report 5-16, and in Report 5-14 found that the SBA itself was reporting awards to large businesses as small business awards.
In the teleconference, Preston also announced that of the 24 federal agencies only half achieved their small business contracting goal. Additionally, he announced that the government had adjusted the total amount of small business contracts awarded to legitimate small businesses for FY 2005 by reducing the previous total by $4.6 billion.
“The SBA has had 10 months to review this data and for them to come out and say that there is still miscoding is unacceptable.” President of the ASBL, Lloyd Chapman said. “After 5 years, it is an insult to the intelligence of every American and every member of Congress, that the SBA thinks that people still believe that billions of dollars a year in awards to some of the nation’s largest defense contractors are the result of random data entry errors. It is absurd and ridiculous. Members of Congress called previous SBA Administrator Hector Barretto dishonest and I think that Preston is following in his footsteps.”
Monday, August 20, 2007
Here is an article from Inc.com reporting the annual statistics published by Small Business Administration Office of Advocacy.
"Businesses with fewer than 20 employees account for 90 percent of all U.S. firms and are responsible for more than 97 percent of all new jobs, according to a new report by the Small Business Administration."
Friday, August 17, 2007
Government Executive.com Agencies fall short of small business contracting goals
By Robert Brodsky August 17, 2007http://www.govexec.com/story_page_pf.cfm?articleid=37809&printerfriendlyvers=1
WASHINGTON, Aug. 17 /PRNewswire-USNewswire/ -- Today Senator John Kerry(D-Mass.), Chairman of the Committee on Small Business andEntrepreneurship, released the following statement in response to therelease of the federal government's "Small Business Goaling Report" for2006. The Small Business Administration released the report detailing themoney each federal agency spent with small businesses, including tominority, women and service-disabled owned firms.
"I'm glad to see Administrator Preston has taken some steps to fix thefaulty and misleading small business contracting numbers and hold agenciesaccountable, but these numbers should still be viewed with caution. Despitethe federal contracting budget increasing by at least $20 billion lastyear, the percentage going to small businesses decreased and the governmentstill isn't counting the whole pie because of special exemptions andexclusions.
"It's critical that we continue to improve the reporting system andcount all contracts in calculations so we know the reality on the ground.It's not about meeting the goals for the sake of meeting a number. Doingmore business with small firms is good for our economic and nationalsecurity because it diversifies our supply base. I will continue to reviewand analyze these numbers and will work with Administrator Preston toensure that the entire government is truly meeting the small businessgoals."
SOURCE Senate Committee on Small Business-Democratic
Thursday, August 16, 2007
1. You lost small business contract because it was bundled
2. You lost a small business contract to a large business because it was bundled
Of course we always keep your information confidential and appreciate your help in exposing fraud and abuse in Federal Contracting. Please just included "Contract Bundling" in the subject line.
Wednesday, August 15, 2007
In their own words…
The government awards contracts to companies with histories of misconduct such as contract fraud and environmental, ethics, and labor violations. In the absence of a centralized federal database listing instances of misconduct, the Project On Government Oversight (POGO) is providing such data. We believe that it will lead to improved contracting decisions and public access to information about how the government spends hundreds of billions of taxpayer money each year on goods and services.
Tuesday, August 14, 2007
By Justo Bautista Staff Writer
northjersey.com August 11, 2007
Thursday, August 9, 2007
With congress going into a break, I wanted to touch base and fill you in on our recent progress towards the removal of large firms from federal small business contracting. For the last two weeks, Lloyd Chapman, Adam Melenkivitz and myself have been in Washington D.C. conducting meetings in the Senate and the House of Representatives. In that two-week period we conducted more than 120 meetings with high level legislative staffers regarding annual re-certification for all firms with federal small business contracts as well as a piece of legislation we are drafting. The meetings went extremely well and we believe that we are closer than ever to an effective legislative solution to stop the diversion of federal small business contract awards to large companies and the practice of federal agencies counting those awards towards the federal governments 23 percent small business procurement goal. We believe, legislation to stop the federal government from awarding small business contracts to large corporations and redirect these funds to legitimate small businesses would be one of the most significant economic boosts to the middle class economy in recent history. We wanted to thank you for reaching out to your elected officials and encourage you to continue doing so with your small business concerns and support for annual re-certification for all firms who currently hold federal small business contracts. However, with the legislation on the horizon, the battle for the removal of large corporations from federal small business contracting is just beginning. Remember, with your help we can provide greater opportunity in federal contracting for small businesses across the country and in your state. This is a very exciting time for all small business owners and in order to reinforce our efforts, we need you and everyone that you know to contact your elected officials and tell them that you support the removal of large companies from federal small business contracting. Tell them that you want an amendment to H.R. 1873, that would require annual re-certification for all firms with existing federal small business contracts and their support for our legislation to stop the federal government from counting awards to large companies towards the federal governments 23 percent small business procurement goal. If our legislation is passed, we believe that as a federal contractor you will see a significant increase in your business and if you are not a federal contractor you will have greater opportunity to become one. Thank you and we will be in touch with updates on this issue as they happen. Best regards, Chris Gunn
Wednesday, August 8, 2007
Addtionally the ASBL is presenting at the San Francisco Small Business Commission on Monday, August 13, 2007 http://sfgov.org/site/sbc_page.asp?id=65664
Sunday, July 29, 2007
Additionally, here is a link to a story that ran in the Federal Times last week.
Thursday, July 19, 2007
Small Business Administration Myth vs. Fact News Release Struggles to Defend New Multi-billion Dollar Loophole for Big Business
Nationally recognized federal contracting expert Professor Charles Tiefer of the University of Baltimore School of Law disagrees. In Professor Tiefer’s December 5, 2006 opinion on the new SBA policy entitled, “Opinion on the Loophole In SBA Size Standard Regulations,” Professor Tiefer stated: “The Small Business Administration’s latest size standard regulations issued in mid-November will still result in the federal government reporting many of its prime contracts performed by large businesses, as small business contract awards, for at least five years to come. I have reviewed the new regulations. Also, I have reviewed the many independent inquiries about the government's enormous loopholes for large businesses to enjoy contracts purportedly awarded to small businesses. It is clear that, after three years of hesitation about doing something, the SBA simply ducked action for even partially closing those loopholes.”
Professor Tiefer is not alone in his opposition to the new SBA five-year grandfathering/five-year re-certification policy. In 2006, the Senate Committee on Small Business and Entrepreneurship voted to close loopholes that have allowed the SBA to report billions of dollars in contracts to many of the largest firms in America as small business awards (http://www.asbl.com/showmedia.php?id=296). They voted unanimously to endorse the annual re-certification policy that was originally proposed by the Office of Federal Procurement Policy in February of 2003 (http://www.washingtontechnology.com/print/17_22/20148-1.html). An annual re-certification policy would require all firms claiming small business status to recertify that status annually, as opposed to every five-years as dictated by the SBA’s recently implemented policy.
Under the annual re-certification policy, large businesses with existing federal small business contracts and firms holding small business contracts that were acquired or had out grown their small business status, would be allowed to keep the contracts they were awarded. However, the federal government would no longer be allowed to include those contracts towards the federal government’s 23 percent small business contracting goal. This would ensure that firms transitioning from small to large would not be punished for growing, and that only contracts to legitimate small businesses would be counted towards the government’s 23 percent small business contracting goal.
Other supporters of the annual re-certification policy included the SBA itself before the arrival of current SBA Administrator Steven Preston, the SBA Office of Inspector General, and the Office of Management and Budget.
SBA Administrator Preston ignored the overwhelming support for an annual re-certification policy and instead initiated the current five-year re-certification policy the SBA had originally proposed in 2005 as a five-year grandfathering policy.
The American Small Business League plans to file their fourth federal lawsuit against the SBA to overturn the policy. They believe the five-year grandfathering/five-year re-certification policy is an intentional loophole the SBA has created that will falsify the government’s compliance with the 23 percent small business contracting goal and divert billions of dollars in federal small business contracts to Fortune 1000 firms and other large businesses.
Monday, July 16, 2007
Here is the link:
Friday, July 13, 2007
Thursday, July 12, 2007
Here is the link:
Wednesday, July 11, 2007
Here is a link to Professor Tiefer's opinion:
Tuesday, July 10, 2007
Monday, July 9, 2007
PETALUMA, CA -- On June 30th, a Small Business Administration policy went into effect that will allow the federal government to count hundreds of contracts to many of the nation's largest defense and aerospace contractors as federal small business contracts through 2012.
The SBA's new five-year grandfathering/five-year re-certification policy will allow the federal government to include billions of dollars in contracts to firms like Boeing, Lockheed Martin, Northrop-Grumman, Raytheon, SAIC, L3 Communications and General Dynamics towards the government's 23 percent small business contracting goal.
In 2005, the SBA included over $650 million in government contracts to defense giant L3 Communications towards the government's small business contracting goal. For 2006, the SBA reported over $500 million to SAIC as small business contracts.
Small business owners around the country are outraged at the new policy and are pledging to take their complaints to Congress and federal court.
When the SBA originally proposed their grandfathering plan in 2005, it would have allowed the SBA to continue to report awards to any firm that had small business contracts towards the federal government's 23 percent small business procurement goal for five more years. This would have included: small business contracts found by the SBA Inspector General as being fraudulently obtained, contracts to large businesses the SBA acknowledged were miscoded as small business contracts, contracts to large businesses that had accidentally claimed small business status, contracts to firms that had outgrown their small business status and contracts to firms that had been acquired by a large business.
When the SBA asked for public comment on the proposed policy in 2005, they were bombarded with over 6000 angry comments opposing the grandfathering policy. Small business owners and small business groups, including the NFIB and Chambers of Commerce across the country, were strongly opposed to the proposed plan.
Even after the SBA received an overwhelmingly negative response to the proposed policy, SBA spokespersons told reporters for the Miami Herald and the Chicago Tribune in June of 2005 that the SBA still intended to implement the five-year grandfathering plan.
Shortly after new SBA Administrator Steven Preston was confirmed, he directed that the unpopular five-year grandfathering policy be renamed five-year re-certification and implemented. The net effect of the five-year re-certification and the five-year grandfathering policy are identical. Under the five-year re-certification policy, the same large businesses that would have benefited from the five-year grandfathering policy will be allowed to maintain their small business status until the year 2012. This will allow the SBA to continue to report contracts to hundreds of Fortune 1000 firms and other large businesses as small business awards for at least five more years.
SBA critics like the American Small Business League believe the real purpose of the SBA's five-year grandfathering/five-year re-certification policy is to artificially inflate the federal government's small business contracting statistics to create the false impression that the government has reached the Congressionally mandated 23 percent small business contracting goal.
ASBL estimates if the policy is allowed to take full effect, legitimate small businesses across America could lose over $300 billion in federal small business contracts over the next five years.
Monday, July 2, 2007
Small businesses are supposed to get 23 percent of federal government contracts. Yet, big companies have been winning some of those jobs. New rules take effect tomorrow that are intended to change that. Steve Tripoli reports.
TEXT OF STORY
SCOTT JAGOW: Small businesses are supposed to get a percentage of federal government contracts — 23 percent to be exact. But somehow, big companies have been getting some of those contracts. So, tomorrow, new rules take effect. They're supposed to address this problem.
But the small business community isn't exactly holding its breath. Steve Tripoli reports from the Entrepreneurship Desk.
Steve Tripoli: Small business owners are angry. They say that too many federal contracts marked as going to small-businesses continue to go to big businesses. The entrepreneurs and President Bush's Small Business Administration can't agree on the extent to which that's happening, or why. Steve Preston heads the SBA. He doesn't think it's much of a problem. And besides, he says, the government isn't out to cheat anyone.
Steve PRESTON: It's less about something subversive or nefarious, and a lot more around people just not doing their jobs the way they need to.
Preston says simple data-entry mistakes are part of what's wrong. And small businesses that win contracts and then grow into big ones also skew the numbers.
Lloyd Chapman of the American Small Business League says Preston's just making excuses for a flawed contract-monitoring program.
Lloyd CHAPMAN: The SBA doesn't want the public to realize that this program is largely smoke and mirrors.
Chapman accepts that small businesses grow or can be bought out by bigger competitors. But he says when that happens they shouldn't be able to be counted as small for as long as they are now. And he says that's not the worst of it.
CHAPMAN: There's been three federal investigations now that have found fraud as one of the reasons why large firms are getting small business contracts.
. . . including one from the SBA's own inspector general.
Chapman doesn't believe the SBA wants to crack down. He points to the agency's new regulation taking effect June 30th. Many businesses will have to report a change from small status sooner, but not until the regulation's been in effect for five years.
Chapman says that's not nearly soon enough, and other small-business people agree.
Cindy Frene: This is actually our backlot where we have just one vehicle, right now. It's part of our livery service.
Cindy Frene has owned her suburban Boston transportation business for 17 years. Like many other small-business owners she's come to see the SBA as more obstacle than advocate for small firms.
Frene has several state government contracts, and a few years ago she tried to qualify for federal work. But that's where she ran into a foul-up she says is typical of the SBA.
FRENE: I basically was turned down because I would have to have had proof that I was discriminated against because I was a woman. Which is laughable because, who would give me a letter that said they didn't hire me because I was a woman?
She sees the same unhelpful pattern in that new, five-year recertification rule that kicks in this month. Frene recertifies her small-business status every year. She has to do that for several state governments. She says it isn't onerous and the businesses handle most of the paperwork.
FRENE: If it's done as a matter of course for states, then why can't the federal government do it too? Rather than continue to put up barriers.
Frene says if companies reported their size annually the SBA would see how many of them are really big businesses taking contracts marked as small. Then it would be forced by law to reallocate more contracts to small firms.
The nonpartisan Government Accountability Office and several congressional committees seem to agree. They've joined small businesses in calling for the change.
PRESTON: There are many people on the other side as well.
That's SBA head Steve Preston. He says annual recertification is too onerous for many dynamic young companies.
Lloyd Chapman of the American Small Business League rejects that argument. He says waiting five years means billions in losses for small businesses. And it flaunts the intent of the 50-year-old Small Business Act.
CHAPMAN: I'm not gonna buy anyone's excuse that it's not feasible to enforce a piece of legislation that's been on the books for 50 years.
The irony here is that a previous SBA inspector general agreed with Chapman. Two years ago, he issued three reports saying that big businesses are unjustly hogging small-business contracts. We asked the current inspector general via e-mail if those problems still exist, and whether they're adequately addressed by the June 30th rule change. His lawyer's answer? No comment.
I'm Steve Tripoli for Marketplace.
Wednesday, June 27, 2007
Check it out:
Tuesday, June 26, 2007
In February of 2006, NASA lost a federal lawsuit to the American Small Business League, which was filed under the Freedom of Information Act. NASA was forced to disclose information that indicated that they had included billions of dollars in contracts to many of the nation’s largest defense and aerospace firms towards their small business contracting goal.
Under the new SBA policy, NASA can continue to include awards to firms such as Boeing and Lockheed Martin in their small business contracting statistics until the year 2012.
The SBA originally proposed a “grandfathering” policy in November of 2004, after a series of federal investigations found the SBA had included billons of dollars in contracts to Fortune 1000 firms and hundreds of other large businesses towards the federal government’s 23 percent small business procurement goal. It would have allowed the SBA to continue to claim that the government had met their small business-contracting goal by continuing to count contract awards to large businesses as small business contract awards. The SBA was forced to shelve the grandfathering policy after receiving more than 6000 objections to the proposed policy.
New SBA Administrator Steven Preston resurrected the unpopular grandfathering policy shortly after he was appointed to office, renaming it “five-year re-certification.” Like the grandfathering policy, the five-year re-certification policy will allow NASA and all other federal agencies to include existing small business contracts to Fortune 1000 firms and other large businesses towards their small business contracting goals for five more years.
The Senate is expected to propose legislation to remove Fortune 1000 firms and all large businesses from federal small business contracting programs before the end of 2007.
Thursday, June 21, 2007
Here is the link:
Friday, June 15, 2007
The removal of such fields would make it harder than it already is to determine which companies in the CCR are small and furthermore, which large companies are obtaining small business contracts. We promote the publishing of a majority of the exempt fields including average revenue, number of employee statistics and NAICS codes along with additional fields that would designate status as a parent company or a subsidiary and to which companies.
Here is the link to the article:
Thursday, June 14, 2007
As early as 2002, federal investigations began to find that the SBA had reported contracts to hundreds of Fortune 1000 firms as small business awards. Two investigations by the SBA Office of Advocacy and the SBA Office of Inspector General found in many cases large businesses had received federal small business contracts fraudulently. (http://www.asbl.com/documents/05-16.pdf)
The SBA responded to the charges by saying the contracts to the large businesses had been "miscoded" as small business contracts. (http://www.asbl.com/showmedia.php?id=393) The new five-year re-certification/grandfathering policy will allow the SBA to continue to include the "miscoded" small business contracts to Fortune 1000 firms in their small business contracting statistics until the year 2012.
Beginning in 2003, the Office of Federal Procurement policy and the SBA Office of Inspector General called for a plan to remove Fortune 1000 firms and other large businesses from the government's small business contracting programs. (http://www.washingtontechnology.com/print/17_22/20148-1.html) The SBA never implemented the policies, and they continued to include billions of dollars in contracts to Fortune 1000 firms and other large business in the United States and Europe towards the government's 23 percent small business goal.
SBA critics point out that if the new five-year re-certification/grandfathering policy is allowed to stand, legitimate small business could lose between $200 and $300 billion in federal small business contracts over the next five years.
Small business owners and advocates were hoping Congress would step in and pass legislation to stop the SBA policy from taking effect. To date, no legislation has been passed to stop the SBA policy or halt the flow of federal small business contracts to large businesses.
Wednesday, June 13, 2007
ASBL - Small Businesses Fight For the Removal of All Fortune 1000 Corporations from Small Business Contracting
As an owner/employee of a small business I am very concerned about H.R. 1873, the Small Business Fairness In Contracting Act. The bill does not contain a provision that calls for the removal of all Fortune 1000 corporations and other large companies from the federal database of small businesses. I am asking that you propose and/or support a provision in the Senate modification of H.R. 1873 that would preclude Fortune 1000 corporations and other large businesses from receiving federal small business contract awards. I am also asking you to propose and/or support a provision that would prevent federal prime contractors and the Small Business Administration from awarding small business awards to large businesses and counting those awards toward the federal government's 23 percent small business procurement goal. The diversion of federal small business contracts has been covered by every major television network and newspaper in America and I believe it is time for Congress to take actions to ensure that federal small business contracts and subcontracts go to legitimate small businesses. We appreciate your help and consideration.
Tuesday, June 12, 2007
Owners slip through the small business loophole
Thursday, June 7, 2007
With the exception of a brief comment from Governor Mitt Romney about the cost of health care for small businesses, the two words “small business” were absent from the debates.
President Bush and members of Congress routinely refer to small businesses as the backbone of our nation’s economy. They’re right: nationwide, small business accounts for 50.1 percent of the private sector workforce with 98 percent of all U.S. firms having less than 100 employees.
An analysis by My Success Gateway (http://www.mysuccessgateway.com/candidate.php), of the websites of major Presidential candidates such as Barack Obama, Hillary Clinton, Mitt Romney, John Edwards and Rudy Giuliani, found no mention of key issues facing America’s 25 million small businesses. Jim Peake, Founder and CEO of My Success Gateway LLC said, “It’s surprising that the websites of major Presidential candidates lack a concentration on solutions for small businesses, seniors and veterans.” Peak points out that 25 million small businesses, 38 million AARP members and 25 million veterans possibly represent 88 million potential votes, which is 72 percent of the 122 million popular votes collectively received by all candidates during the 2004 election (http://en.wikipedia.org/wiki/U.S._presidential_election,_2004).
Since both political parties have repeatedly promised to clean up fraud in government; small business advocates watched the debates hoping to see some mention of the twelve federal investigations that found the Small Business Administration had included billions in federal contracts to Fortune 1000 corporation such as Boeing, Lockheed, L3 Communications, Raytheon and Rolls Royce towards the federal governments 23 percent small business goal. Two separate investigations found that fraud was responsible for the diversion of federal small business contracts to big businesses.
“The fact that there were no questions or comments relating to America’s 25 million small businesses is a prime example that small businesses do not have the voice in Washington they deserve,” American Small Business League President Lloyd Chapman said. “We are going to change that before the next debates.”
Thursday, May 31, 2007
The proposed policy would call for the five-year re-certification of small business status for all firms who have been awarded a federal small business contract based on that standard. The policy will allow Fortune 1000 corporations and their subsidiaries to continue to collect on existing federal small business contracts through the year 2012.
“Five-year re-certification will cost New Hampshire small businesses millions,” American Small Business League President Lloyd Chapman said. “Annual re-certification is the best, most reasonable and prudent method of removing Fortune 1000 corporations and their subsidiaries from America’s federal small business contracting program.”
Without annual re-certification, U.S. firms will loose more than $60 billion a year, or more than $300 billion over the next five-years. This could translate to huge losses for New Hampshire small businesses through 2012, Chapman emphasized.
In recent years, the SBA, the SBA Office Inspector General, the Office of Federal Procurement Policy, the Office of Management and Budget and the Senate Committee on Small Business and Entrepreneurship have all endorsed an annual re-certification.
The Preston policy could force legitimate small businesses in New Hampshire to compete with some of the largest businesses in the country for even the smallest federal contracts. Groups like the American Small Business League are pledging to rally the support of small businesses around the country and even take legal action if necessary to stop the policy from going into effect.
“The proposed SBA policy is bad for small business and it is bad for New Hampshire,” Chapman said. “New Hampshire’s small business supply more than 305,000 jobs in the state; annual re-certification for all firms with existing federal small business contracts will only protect those employers and their employees.”
Wednesday, May 30, 2007
2008 Presidential Candidates Ignore Backbone of U.S. Economy, According to a Study By My Success Gateway LLC
On August 15, 2001, President George W. Bush addressed the Hispano Chamber of Commerce in Albuquerque, New Mexico and in regards to the economic impact of small businesses in America stated, "Most of the new employment in America comes from small-business owners. Small business is the backbone-is the backbone of our economic system."
Contradictory to this statement the Bush Administration has taken action to cut the Small Business Administration's budget significantly during the course of their term. In 2001, the last year in the Clinton administration, the SBA's budget was $1.1 billion. However, at the inception of the Bush Administration the SBA budget proceeded to drop to $579.5 million in 2005 and $456.5 million in 2006, according to a November 21, 2005 article in Inc Magazine.
"It is amazing that this field of candidates are absent of any solutions to strengthen small businesses, the backbone of the U.S. Economy," said Jim Peake of My Success Gateway LLC, a resource for entrepreneurs and small businesses. "Looking at the numbers the current administration has eroded the backbone and America is asleep at the wheel, probably paying more attention to the personal business of Paris Hilton than to the small business backbone of America."
It is concerning that candidates expressed more interest on the war in Iraq, Immigration and wedge issues than the small businesses that make up the backbone of the U.S. economy. "What the candidates fail to realize is that small businesses are funding a significant portion of the war in Iraq, and carrying a heavy burden in repaying the national debt," expressed Peake.
For Instance, in the State of New Hampshire there are 31,593 employer firms with fewer than 500 employees and those firms provide 305,000 jobs in the state. During the 2004 presidential race, George W. Bush received 331,237 popular votes and lost the state to Senator John Kerry who obtained 340,511 popular votes. Thus, by ignoring small business interests the presidential candidates are ignoring a large portion of American voters. "If any one candidate were to focus on small business in New Hampshire they could potentially wrap up the majority of the popular vote for that state," Peake said.
"The fact that the presidential candidates are virtually ignoring small business interests, is an indication that the candidates do not take small businesses seriously," American Small Business League President, Lloyd Chapman said. "Small businesses need to take a look at this situation and realize that it is time to get organized, create a movement for change, and ask these candidates about how are they going to support small businesses in their presidency."
Visit the 2008 presidential candidate web-site review at (www.mysuccessgateway.com/candidate.php) for more information and sign up here (www.asbl.com/join.php) for more breaking information.
Thursday, May 24, 2007
It is amazing that with such powerful words to describe the importance of small businesses to America; the White House has cut the SBA budget and is against any program to increase contracts for small businesses and the SBA its self is against a piece of legislation to give more contracts to small businesses. In fact, the White House has openly opposed H.R. 1873 the, "Small Business Fairness in Contracting Act."
Here are some facts: 98 percent of businesses in the United States have less than 100 employees, 89 percent have less than 20 employees. Additionally, there are 25,000,000 small businesses in the United States, which employ 50.1 percent of the private workforce. Small Businesses are the back-bone of America's economy, and it seems like maybe it is time the federal government to start treating them as such.
Here is the link to the MySuccessGateway.com blog:
California Small Businesses Plead with Senators to End Fraud and Abuse in Federal Small Business Contracting
To date, fourteen different federal investigations have all found that billions of dollars in contracts earmarked for legitimate small businesses have instead found their way into the hands of some of the largest companies in the United States and Europe.
The bill, H.R. 1873 the “Small Business Fairness in Contracting Act,” passed through the House of Representatives last week and will allow large companies like Boeing, Lockheed Martin, Halliburton, Rolls-Royce and L3 Communications to keep their existing federal small business contracts for up to five more years.
Small business owners are asking Senators Boxer and Feinstein to amend the bill and push for the immediate removal of all Fortune 1000 corporations and other large companies from federal small business contracting programs and to force all firms with existing federal small business contracts to re-certify on an annual basis.
The campaign to garner the support of Senators Boxer and Feinstein has been organized by the Petaluma, California based American Small Business League. If Senators Boxer and Feinstein can convince the Senate to add a provision in the new legislation to close the loophole that allows Fortune 1000 corporations to obtain small business contracts, the ASBL predicts that up to $60 billion a year in federal small business contracts would be re-directed to legitimate small businesses in California as well as every other state in the country.
Federal procurement for small businesses is centralized within 50 miles of Washington D.C. and an annual re-certification provision would de-centralize that procurement and spread those purchases and contract dollars more equitably around the nation.
Wednesday, May 23, 2007
Proof - In their response to the ASBL press release the SBA said, “No proposal for a ‘grandfathering’ provision was ever made...” Yet, it was published in the Federal Register in volume 69, 70200, No 232 on December 3, 2004. And, multiple publications prove otherwise. Also, in a June 9, 2005 story in the Miami Herald titled, “Small Business Seek Fair Fight for Contracts,” SBA spokesman Gary Jackson admitted that the SBA would pursue a five-year grandfathering plan. Again, in the Chicago Tribune on June 21, 2005 in a story titled, “SBA Hearing Fields Opinions on Small Business,” an SBA spokesperson talked about a five-year plan. Several other stories were written about the SBA grandfathering proposal.
The SBA grandfathering plan would allow any firm with an existing federal small business contract to keep it for five more years. The five-year re-certification plan will allow any firm with an existing small business contract to keep it for five more years.
As far as the federal small business contracts currently held by Fortune 1000 firms, grandfathering and 5-year recertification are virtually identical.
Tuesday, May 22, 2007
Proof- The SBA’s assertion that there have not been 14 federal investigations is blatantly false. These reports and key statements are readily available on the ASBL website. In this response the SBA tries again to mislead by diverting attention from the fact that only a very small percentage of the contracts that the federal government reports as going to small businesses are actually formal set aside contracts. Again, the SBA fails to mention, that the policy allowing Fortune 1000 firms to acquire a small business and keep the small business status for 20 years was originally drafted by the SBA.
Again, SBA Inspector General Reports 5-14, 5-15 and 5-16 all found large businesses were receiving federal small business contracts. The Eagle Eye report from the SBA Office of Advocacy found “vendor deception” -- more evidence of fraud. A report from the Center for Public Integrity found the Pentagon alone had awarded over $47 billion in small business contracts to some of the nations largest defense contractors. Investigative reports by ABC, CBS and CNN all found Fortune 1000 firms were receiving billions of dollars in federal small business contracts to Firms like Boeing, Lockheed Martin, Raytheon, Titan Industries, L3 Communications, Rolls Royce and AT&T who did not recently out grow their small business status.
Monday, May 21, 2007
Saturday, May 19, 2007
Proof - This was established in SBA Inspector General Reports 5-14, 5-15 and 5-16. The SBA uses the term “set aside for small business.” This avoids addressing the 90 percent of the contracts the government reports as going to small businesses that were not “set aside” contacts. They do not address the thousands of small business contracts that are already in place with hundreds of Fortune 1000 firms and international firms. Once again they try to divert attention from the billions of dollars in existing contracts with large corporations by talking about firms that might be merged or acquired in the future.
Friday, May 18, 2007
Proof - The best information to prove this is in the SBA's own statements. They do not provide any information on firms that have been penalized or prosecuted for misrepresenting themselves as small businesses. They use terms like “will be denied” and “subject to fines.” Again the GTSI case is a typical example, they were recommended for debarment by the SBA Inspector General and the SBA did nothing.
A report released in 1995 by the SBA Inspector General is another great example. They found fraud in federal small business contracting and the SBA took no action against those firms. In another instance, the SBA Office of Advocacy commissioned an investigation that found large businesses were guilty of “vendor deception” a synonym for fraud to receive small business contracts. The SBA took no action against those firms. Furthermore, On February 24, 2005 in Report 5-16 the SBA Inspector General found “false certifications” and “improper certifications,” more synonyms for fraud responsible for large businesses receiving federal small business contracts. The SBA took no action against those firms.
Thursday, May 17, 2007
Proof - Noted federal contracting expert Professor Charles Tiefer of the University of Baltimore School Of Law, issued an opinion on the loophole in the SBA's five-year re-certification plan. Tiefer concluded that the, “SBA's latest size standard regulations issued in mid-November will still result in the federal government reporting many of it's prime contracts performed by large businesses as small business contract awards for at least five more years to come.”
By the time the SBA's five-year re-certification policy goes into effect on June 30th, federal agencies and prime contractors will have had several months to enter into hundreds of long term contracts with hundreds of large businesses that will avoid any of the “triggering events.” Another loophole for big business created by SBA Administrator, Steven Preston.
Wednesday, May 16, 2007
Proof - As early as 1995 the SBA Office of Inspector General found fraud in federal small business contracting. In their semi-annual report to Congress, the SBA Inspector General reported officials at the SBA declined to adopt their recommendation to stop the fraudulent activity. SBA official Robert Neal wrote the response to the SBA Inspector General declining to adopt the recommendation to stop fraud. Neal was later convicted of soliciting bribes, extortion, money laundering and witness tampering. He was sentenced to 25 years in prison.
The SBA has refused to place a warning on small business databases informing vendors that misrepresentation of a firm as a small business to illegally receive federal small business contracts is a felony under section 16 (d) of the Small Business Act, with a penalty of up to ten years in prison.
The SBA’s currently proposed five-year re-certification rule will allow large businesses, including large multinational firms, to continue to receive federal small business contracts for five more years.
In December, the SBA removed employee and revenue data from the government vendor database, which the public uses to determine small business status of government contractors. Legitimate small businesses used this information to file protests against large businesses falsely claiming to be small businesses. This will make it difficult, if not impossible, for legitimate small businesses to file protests and make it easier for large firms to misrepresent themselves as small businesses.
A prime example of misrepresentation comes in the form of the GTSI corporation case in which the SBA Inspector General recommended GTSI for debarment. To this date the SBA has taken no action and GTSI continues to receive hundreds of millions of dollars in federal contracts.
Proof - The Dutch firm Buhrmann NV is a good example. In the SBA response to this point they admit that large corporations have been allowed to acquire small businesses and keep those contracts for the life of the contract, which can be up to 20 years. They refer to this practice as “under federal rules.” What the SBA has failed to mention is the SBA is the agency that initiates federal policy on federal small business contracting policy. They created the federal policy that allowed large businesses to acquire a small business and keep that status for 20 years.
Proof - Report 5-15, released by the SBA Inspector General in March of 2005 stated, “One of the biggest challenges facing the Small Business Administration and the entire federal government today is that large businesses are receiving small business procurement awards and agencies are receiving credit for these awards.”
In Report 5-14, the SBA Inspector General investigated the SBA's own small business contracting statistics. They reviewed the six largest contracts the SBA itself had reported as going to small businesses. Report 5-14 states, “Of the six high dollar contracts reported as going to small businesses, four were awarded to large businesses at the time of the procurement.” One of the four small business contracts actually went to Buhrmann NV, a multinational, multi-billion dollar corporation headquartered in Holland with 17,000 employees in 26 countries.
Thursday, May 10, 2007
Federal Small Business Contracting
1. Establish an annual recertification policy for all firms with existing Federal small business contracts, effective June 30, 2007. Current federal policy requires all government vendors to update their information annually on CCR, therefore annual recertification can be completed at that time simply by updating one box in the database. Annual recertification will be a simple, easy, quick and efficient way to stop the flow of billions of dollars in federal small business contracts to Fortune 1000 firms and other large businesses. In the past annual recertification has already been endorsed by the SBA (prior to the arrival of Steven Preston), the SBA Office of Inspector General, the Office of Federal Procurement Policy, the Senate Small Business Committee and the Office of Management and Budget.
2. Establish a federal policy that precludes any award made to a Fortune 1000 firm, its subsidiaries, or any of its divisions from being reported as a small business award. A company’s small business status should end the day that the firm is acquired by a large business.
3. Amend the Small Business Act to require annual re-certification. Require all government suppliers claiming status as a small business to recertify their size status on an annual basis. This can be done easily and efficiently online.
4. Ensure that all federal small business contracts that are only reported in the name of the parent company, removing any confusion about the actual recipients of the award.
5. Aggressively prosecute fraud and misrepresentation. Misrepresenting the size of a firm in order to illegally receive federal contracts and subcontracts is a felony with penalties of up to 10 years in prison, a fine up to $500,000, cancellation of all contracts and debarment from selling to the government. Policy should require the SBA to respond to any protest against any firm that misrepresents its size, regardless of whether or not the contract is a small business set-aside. Section 16(d) of federal code makes no differentiation as to the type of contract; therefore current SBA policy is illegal and clearly does not address the magnitude of the problem.
6. Abolish any federal policy giving special preference to Alaskan Native Corporations under the 8(a) program that is not given to other participants in the 8(a) program.
7. Publish a warning on all contractor databases. Any and all government databases for small business should clearly state the penalties for misrepresentation.
8. Enforce “Liquidated Damages” and all other existing federal laws for prime contractor non-compliance with small business goals. Because this law has never been enforced, most prime contractors never achieve the small business goals stated in their government prime contracts.
9. Remove any and all exemptions to the $100,000 small business set-aside. Congress passed legislation mandating all federal acquisitions between $2,500 and $100,000 to be automatically set-aside for small business. The SBA and the FAR Council essentially repealed this valuable piece of legislation by exempting all acquisitions on the GSA schedule from this policy.
10. Eliminate the “Comprehensive Test Program.” This program allows major prime contractors to avoid complying with their small business goals by eliminating specific small business reporting on individual contracts. It also eliminates “Liquidated Damages” for those companies under the program.
11. Force the SBA to publish a list of firms that have been removed from the small business contractor database for misrepresentation and add firms to the list monthly that lose their small business status through protests. Provide it to all federal agencies and prime contractors.
12. Establish federal policy that precludes the SBA from dismissing small business protests on non-small business set-aside contracts.
Monday, March 19, 2007
American Small Business League President Lloyd Chapman says he believes the Bush administration’s expenditure of over $50 million a month to some of the nation’s largest public relations firms is hampering his efforts to expose billions in fraud and abuse in federal small business contracting programs.
“White House PR firms have been working overtime to kill stories on Bush administration policies that have diverted over $300 billion in federal small business contracts to the top 2 percent of U.S. firms,” Chapman said.
A 2006 Office of Government Accountability report found the Bush administration had spent $1.6 billion over 30 months on public relations campaigns and advertising. In some cases, journalists like Armstrong Williams were paid as much as $240,000 to promote pro-Bush administration policy and pass it off as unbiased opinion.
Chapman points to a pattern over the last few years wherein newspapers, magazines and even some of the largest television networks drop his story once Bush administration officials were notified.
NBC spent a week in California filming a story on Chapman and his successful legal battle to stop the Bush administration from diverting billions in federal small business contracts to Fortune 500 firms, but the story never aired. CNN’s Lou Dobbs Tonight spent a month researching and filming a story on Chapman and his organization, but pulled the story just hours before it was supposed to air. When the story finally aired six months later, any mention of Chapman and the American Small Business League had been deleted. CBS spent weeks working with Chapman and his staff on what would have been CBS’s third installment in a series of investigative reports on the diversion of billions in federal small business contracts to firms like Rolls Royce, Wal-Mart, Boeing and Lockheed Martin. The story was suddenly halted after the SBA found out about the piece.
After spending months working with the New York Times on a story, any mention of Chapman and his group was removed from the story after it was written.
“After the New York Times story, I was contacted by the Los Angeles Times. They wanted to do a story on my campaign to stop fraud and abuse in federal small business contracting,” Chapman said. “I told the reporter if she mentioned me in the story, my name would be removed before the story ran, but she laughed. She called me the day the story ran, very upset, and told me her editor removed all references to me in the story.”
Chapman says he believes other publications have suddenly dropped their stories on this issue after being pressured by White House public relations firms, including the Associated Press, USA Today, Wall Street Journal, Dallas Morning News, BusinessWeek, Inc Magazine, Entrepreneur, Fortune, Fortune Small Business and dozens of other smaller newspapers and magazines around the country.
“We intend to use the Freedom of Information Act to uncover more information on exactly how PR firms working for the Bush administration are able to exert so much pressure on the media,” Chapman said. “I would like to see Rep. Henry Waxman hold hearings into why the Bush administration needs to spend $50 million a month on PR firms and exactly what those firms are involved in.”
Petaluma, Calif.- Since the Democrats took control of Congress in January, more than $10 billion in small business set-aside contracts have been diverted to some of the largest firms in the U.S. and not one piece of legislation has been passed to stop it.
There have been over 400 stories in the media and 14 federal investigations over the last four years on large businesses receiving small business procurement awards. The Small Business Administration Inspector General called this situation “one of the most important challenges facing the Small Business Administration and the entire Federal government today.”
Lloyd Chapman, president of the American Small Business League, said that although the Democrats pledged to clean up fraud, corruption and abuses in government while campaigning for Congress, they have given nothing but lip service to this issue.
“The Democrats have blamed the Republicans for years for the loopholes and abuse in federal small business contracting and yet, now that they are in power, they have done nothing to change it,” Chapman said. “If you look at the House and Senate Small Business Committee Web sites, you will notice that any mention of small business contracting abuse is conspicuously absent.”
Sen. John Kerry, current head of the Senate Small Business and Entrepreneurship Committee, who has been a proclaimed advocate for small businesses for nearly two decades, has publicly stated that the current policies are inefficient.
“Politicians love to say they want to help small businesses,” Kerry said in the Marin Independent Journal. “But how can any politician make that claim with a straight face when contracts that should be going to these hard-working small businesses are being turned into giveaways to large multinational companies?"
Rep. Nydia Velázquez, the head of the House Small Business Committee, has also challenged current SBA policies in investigative reports on CBS, ABC, and CNN and in the New York Times.
“The fact that large businesses are being awarded with small-business contracts, and that there is no system in place with penalties or consequences for this, is extremely concerning,” Velázquez said in a New York Times article in December 2006.
Chapman said that despite all the statements Velázquez and Kerry have given regarding the magnitude of this problem, they continue to be “all show and no go.”
“I hope we get more than just talk from the Democrats like we got from the Republicans,” Chapman said.
ASBL research concluded that approximately half of all funds reported as going to small businesses actually went to some of the largest firms in the U.S., totaling nearly $65 billion a year. Chapman said this problem could be easily resolved with passing an annual recertification policy, but instead, the SBA passed a five-year plan that will allow large businesses to continue collecting small business awards until 2012.
“Five-year recertification is just like repealing the Small Business Act for the next five years,” Chapman said. “I can’t believe we’re even talking about how many more years Fortune 1000 firms will get small business contracts.”